US tech stocks recovered on Tuesday after a selloff linked to concerns about AI spending. The Nasdaq rose 0.83% and the S&P 500 climbed 0.37% by market close, while the Dow fell 0.38% after Apple posted weaker margins due to higher chip costs. Nvidia led chipmaker gains with a 2.3% rise, while Advanced Micro Devices, Broadcom and Micron Technology also saw increases.
The midterm elections did not have a large immediate effect on Wall Street, but investors expect Democrats to secure at least a majority in the House, which could lead to more regulation of AI. The Nasdaq had recently entered correction territory, dropping 10% from its early October peak, but Tuesday marked the end of the recent decline in tech and AI stocks. Brent crude oil prices also eased, dropping to $103 a barrel.
Wall Street has continued to benefit from investments in AI infrastructure, despite concerns over the cost of living influencing voter sentiment. Historical analysis suggests markets tend to recover after US elections, as uncertainty lifts and results become clearer. For regulated industries, the prospect of increased AI oversight remains a key issue as the new Congress takes shape.
